Property rights, particularly intellectual property (IP) rights, have become an important factor in commerce. While the IP field is wide-ranging, for ease of discussion it might be easier to focus on patents, copyrights, trademarks and tradesecrets. Many companies spend large sums of money on development and research and as a result thereof over a course of time create very valuable intellectual property. These valuable rights are often manifest in the issuance by the government of Letters Patent. Such patents have inherent rights associated with them, these rights being the right to prevent others from making, using selling, or importing any product that infringes any claim of the patent. Often, a fair amount of a company's true value is represented by its patent portfolio
Since the value of a company's IP rights is unique to that company, this does not have much liquidity. Accordingly, financial institutions typically can not lend money based on such IP rights. Thus, while a company may have a high valuation based on its know how and other IP rights, that valuation is mostly unavailable as collateral for a financial transaction such as a loan. This then means that great wealth is today being held in a most intangible manner and can often only be obtained (if at all) by bringing expensive and time consuming patent litigation. Accordingly, a large portion of the value of a company is locked away and unavailable to support future growth.